“Drivers who own [defective, shoddy and/or downright dangerous] Chrysler, Dodge and Jeep vehicles will retain their Lemon Law rights to compensation for defects under a deal between U.S. states and Chrysler LLC’s new owners, [Florida] Attorney General Bill McCollum said Wednesday.” And so the AP reassures ChryCo’s remaining half dozen or so prospective retail customers that they can once again buy with confidence from the bankrupt, federally-sponsored zombie automaker. More specifically, Fiat Group SpA has agreed to stand behind ChryCo crap. Not that all Chrysler’s products are crap, obviously. Well, perhaps not that obviously . . .

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Far be it for me to extend TTAC’s reputation for putting a negative spin on news trumpeted as a sign that the auto industry’s dark days are coming to an end. But this story—“Toyota sees turnaround, boosts U.S. output”—is making the ’rounds, and it bears closer examination.

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Sorry to bang on about Fritz Henderson. But, well, there he is. Again. Still. With every passing post-C11 day, the GM CEO is sealing his position as the “Uncle Walt” of the federal automotive bailout. With every news conference, media suck-up and, now, congressional inquiry, it’s increasingly clear that Government Motors’ masters aren’t going to give GM’s mustachioed public face the old heave-ho anytime soon. Or, more accurately, soon enough. Let’s face it: the Presidential Task Force on Autos should have sent Fritz his walking papers on the same day they defenestrated his mentor: GM’s last CEO. In and of itself, this failure to excommunicate is enough to abandon all hope of the zombie carmaker’s resurrection (which is an inherently ridiculous idea anyway). Drilling down deeper, we hit nothing but sewage.

Chrysler Co-Prez Jim Press and GM CEO Fritz Henderson faced congressional opprobrium this afternoon, as our duly elected representatives lamented the fact that the two zombie automakers are pulling the rug from under the pols’ financial backers—I mean, cutting car dealers. Never mind the bollocks; the bailout bonanza just got a big bigger. Detroit News reports that Henderson told the Senate that “GM could have 3,500-3,800 dealers by the end of next year, a reduction of 2,300-2,600 dealers. He said the reductions were painful but unavoidable.” Applying this morning’s pay-off formula (an average of $500,000 per dealer), that raises the price of the federally-sponsored sayonara to $1.1 billion to $1.3 billion. But don’t worry, ’cause Fritz feels their pain and promises this is the last last time GM will downsize.

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Here’s an email making the rounds amongst GM’s remaining employees:

Just announced: Now through June 30, 2009, the GM Employee Discount for Friends program* lets you share employee pricing with anyone you know who owns a competitive vehicle. It’s the ideal way to get more friends into GM vehicles.

Here’s how it works:

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Ford is starting to get pissed off at the feds for rewarding their cross-town rivals’ failure, taking bread off their table. On Monday, FoMoCo spinmeister Mark Truby pointed out that “If you’re competing against a company that’s majority owned by the U.S. government, that does raise certain concerns about what the competitive dynamic will be for the industry.” Translation: will Chrysler and GM use taxpayer money to keep customers from defecting to The Blue Oval Boyz (amongst others). Yes they can! The Associated Press reports that Chrysler is tapping into bailout bucks to launch a fresh round of incentives to keep pumping blood into the Auburn Hills automaker’s corpse: 0 percent financing for 60 months or up to $4,000 cash back on “certain” 2009 Chrysler, Dodge and Jeep models. Oh, and Chrysler owners get $1,000 loyalty cash towards a new 2008 or 2009 car. Yes, 2008. Chrysler says the promotion runs until July 1. At the least.

GM CEO Fritz Henderson has filed a deposition with the federal bankruptcy court [download here] pleading for a 363 motion that would create the “new” zombie GM from the corpse of old debt-ridden GM. “In the face of the global meltdown of the financial markets, and a liquidity crisis unprecedented in GM’s 100 year history, there is only one way to maximize the value and permit the survival of GM’s business and save hundreds of thousands of jobs associated with not only GM, but also its vast supplier and dealer networks: these chapter 11 cases and the prompt approval of the 363 Transaction.” While I don’t expect Fritz to say “GM has entered this crisis due to epic mismanagement of which I am a fundamental part,” it strikes me as odd that this blame avoidance arrives on page three. Isn’t it a bit early to say “it’s not our fault?” Apparently, early and often is the strategy here.

For the last ten years or so, the United Auto Workers (UAW) has pretended to make “concessions” to General Motors while doing nothing more than accepting pay-offs consisting of lump sums and promises to pay lump sums from fictional future earnings. Exhibit R: the fed’s recently promised $2.5 billion cash “top-up” of the UAW’s health care VEBA, ahead of other payment of other lump sums AND a slice of fictional future earnings. Automotive News [sub] reports that GM’s deep-sixed dealers are now playing grease my palm at wounded knee. “General Motors is offering some dealerships $100,000 to $1 million to wind down their businesses over the next 17 months, according to three sources familiar with the proposals.”
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The Alterman era is upon us.

As an Elvis fan, I have to say that the singer created an enormous body of completely unlistenable music. The Hollywood years are particularly execrable, generating as they did an entire canon of crap. In the same sense, Volvo. In recent history, the American-owned Swedish automaker has unleashed a range of vehicles that did little more than remind us how far the iconic brand has fallen. For example, Volvo’s minivan, which—oh wait. They didn’t make a minivan. Right. Volvo’s XC SUVs arrived late, with the wrong engines, with a rep for tank-like build quality and unimpeachable reliability that was only obvious by its absence. Ditto Volvo’s sedans. And now, Volvo’s ’68 Comeback Special: the XC60.

Way hey! Ford is claiming a major victory, even as its U.S. May sales dropped 25.8 percent. The Blue Oval Boyz trumpet the fact their market share has grown to its “highest level since 2006.” So Ford is now where they were when ex-Boeing exec Alan Mulally took over (for a $25 million year one payout). And once again, Ford forgets to assign this glorious rising market share a numerical value. Let’s be clear here (even if Ford isn’t): they’re talking about retail share. At the end of  the first quarter, Ford’s overall share of the U.S. market, measured traditionally, fell to 13.9 percent, a loss of 1.1 percent. What was that about lies, damn lies and Ford press releases? Drilling down is even more depressing.

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Bankrupt parts maker Delphi is set to finally leave bankruptcy, thanks to a little help from American taxpayers (who else?). OK, sure, technically, only a small fraction of Delphi’s just announced $3.6 billion dollar rescue pack will come from the federally funded “new” GM. We’re talking table scraps, at $250 million. Mind you, this cool quarter billion doesn’t include GM’s forthcoming purchase of five– count ’em five Delphi plants– at an undisclosed price. And if past history is a guide, well, let’s not forget that GM has taken more than $11 billion in charges against Delphi since they spun-off their money-losing division. As Automotive News [sub] reports, we don’t know how much Platinum Equity is paying to buy Delphi’s worldwide ops, or how much of the manufacturer they’ll actually own (i.e. how much we own). Although Bloomberg seized on Delphi’s exit strategy as sign that the auto industry has turned a corner, it’s probably more of a sign that the strip and flippers—cough Cerberus cough—-know a sucker when they see one.